On Tuesday, General Motors announced that it earned $2.5 billion prior to taxes during the third quarter, which was down over 32% from the same period one year ago of $3.7 billion, but higher than Wall Street expectations.
Looking at a net income basis, GM lost over $3 billion, but that also reflected accounting charges of $5.4 billion for its sale of the Vauxhall and Opel brands in Europe to PSA Group.
The Detroit based auto giant warned earlier this year that its profits could decline during the second six months of 2017 due to cuts in production of its slower selling vehicles and the retooling of several of its plants for producing new SUV and crossover models.
Nevertheless, the financial results for the period from July through the end of September equaled $1.32 a share, which beat expectations on Wall Street. Analysts were expecting from $1.11 to $1.15 a share.
Investors are more positive about GM the past few months, largely due to a perception the company is quickly moving in its development of autonomous technology.
During early 2016, the biggest automaker in the U.S. invested over $500 million in Lyft, the ride hailing service and the acquisition of Cruise Automation, a company focusing on autonomous vehicle tech that is based in San Francisco.
Shares of GM have increased by 30% thus far in 2017. Investors helped drive the share price up in premarket trading on Tuesday by 3% after news of the quarterly results was released. If that is sustained throughout the trading period, it would be a new high for 2017.
The automotive sales at GM were down 16.6% for the quarter from $36.5 billion the previous year to $30.5 billion. That is a reflection of recent decisions at GM to leave a number of markets, including India, Europe as well as South Africa.
General Motors also wound down its Australian production and ended it in full on October 20.
The bulk of profit for the third quarter at GM once again was from North America, as its sales in the U.S. rebounded during August and into September, after dropping during July.
GM as well as other automakers expect sales in the U.S. to slow at a gradual rate, and it is continuing to adjust to the shift in consumers’ wants to SUVs, crossovers and pickups from passenger cars.
GM said that it was slowing production at different factories where sedans were being made and would also extend Christmas breaks at some locations.